Pioneering Hiabwell positioned for further profitable growth

Hiab Investor Day 1 December 2017

1

Agenda Presenters

2

10:00 – 10:05 Welcome

Hanna-Maria Heikkinen

VP, Investor Relations, Cargotec

10:05 – 11:30 Pioneering Hiab

Presentation and interactive Q&A

Led by Roland Sundén, President, Hiab

11:30 – 11:50 Demo Sessions

Connected Solutions• HiVision™

• HiConnect™

11:50 – 12:00 Closing

Roland Sundén

President, Hiab

Simon Greaves

CFO, Hiab

Anna Almlöf

VP Services

Jan-Erik Lindfors

VP, New Business

Solutions

Magnus Pettersson

Sr. Manager, NBSTomas Dziugelis

Director, NBS

Well positioned for further profitable growth

Accelerated our growth and

delivered strong business results

Strengthened our equipment and

service leadership positions

Favorable market situation

continues – while managing

headwinds from currencies,

commodity prices, and supply side

Capturing further growth

opportunities

3

Hiab – a global leaderin on-road load handling

*) Excluding restructuring costs

**) LTM = Last 12 months (Q4 2016 – Q3 2017)

Global leader in on-road load-handling equipment and solutions

Strong brand reputation and loyal customer base

Comprehensive global sales & service network

Total offering of state-of-the art equipment, services, and connected solutions

Ambition to be the number one partner, inspiring and shaping the industry

MEUR Q3 2017 LTM**

Orders received 1,109

Order book 293

Sales 1,061

Operating profit* 150.2

Operating profit margin* 14.2%

Personnel (Q3/17) 3,251

Sales mix 2017 LTM**

Equipment

77%

Service

23%

Sales mix

2017 LTM**

AMER

40%

APAC

12%

EMEA

49%

4

5

Excellent business performance development

Outperformed market in sales & service execution

Growth in key regions and all equipment segments

Reinvest in portfolio, distribution, digital offering

Built world-class infrastructure for spare part sales

Continued invest in distribution network

Introduced new service and connected offerings

*) LTM = Last 12 months (Q4/16 – Q3/17)**) Excluding restructuring costs

MEUR MEUR

197 196

218233 239

23% 23% 23% 22% 23%

0%

10%

20%

30%

40%

50%

0

50

100

150

200

250

2013 2014 2015 2016 2017 LTM*

Service sales % of sales

841 840928

1,036 1,061

24

61

100

140150

0

50

100

150

200

250

0

250

500

750

1,000

1,250

2013 2014 2015 2016 2017 LTM*

Sales Operating profit** Operating profit** margin

2.9% 7.3%10.8%

13.5% 14.2%

MEUR

6

Strengthened our market positions

MARKET SIZE*

(EUR billion)

KEY

SEGMENTS

HIAB POSITION

& TREND

*) Cargotec estimate

~1.3

~0.5

~0.5

~0.3

~0.2

Retail

Logistics

Waste and

Recycling

Construction

and Logistics

Timber, Pulp

and Paper

Construction

and Logistics#1-2

#1

#1

#1

#2

LOADER

CRANES

TAIL

LIFTS

DEMOUNTABLES

TRUCK MOUNTED

FORK LIFTS

FORESTRY

CRANES

Strength in key segments basis for customer solutions

BUILDING MATERIALS

SPECIAL LOGISTICS

FIRE & RESCUE

AGRICULTURE

LANDSCAPING

GLOBAL PRESENCE

Global

Hiab Sales & Services

network

CUSTOM SOLUTIONS

MarineRail Wind

DIVERSE CUSTOMERS

Single Truck Owner Intl. Fleet Company

SOLUTION PROVIDER

Equipment

Service

Connected Solutions

CONSTRUCTION

WASTE MANAGEMENT

FORESTRY

DELIVERY LOGISTICS

RECYCLING

DEFENSE

7

US market fundamentals remain strong. US$/€

softness impacting our business.

US the single biggest market for Hiab with

strong market position. Leading in loader cranes

and truck-mounted forklifts, stable #2 in tail lifts.

Hiab owned distribution enabling strong service

business.

Ambition for continued growth in loader cranes,

new applications for truck-mounted forklifts – and

further drive services.

US – leveraging the market momentum

8

Source: Census.giv

Source: Oxford Economics: Industry output forecast 9/2017

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

North America construction output y/y change

Market fundamentals positive across Europe

after rebounding from north to south. South

Europe with first orders; Russian market still

challenging but first positive signs.

Hiab growing and taking market share across

all equipment categories and territories –

winning share in loader cranes and forestry

cranes, leading in truck mounted forklifts and tail

lifts.

Further growth with focus on key account,

targeted investments in route-to-market driving

services, and key markets.

Continue focused growth in Europe in positive market

Source: Oxford Economics: Industry output forecast 9/2017

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

2011 2012 2013 2014 2015 2016 2017 2018 2019

EMEA construction output y/y change

Source: IMF world economic outlook

9

Continue focused growth in Europe

10

Key markets focus to invest into

further growth

• Established strong market position

as platform for further growth

• Increase sales coverage for core

products

• Targeted route-to-market

investments to drive service

growth

Unlock growth potential in further

markets

• Mature markets with further

growth potential or markets with

potential after rebounding

• Mostly dealer/importer based

Hiab successfully concluded the acquisition of

Argos Guindastes Indústria e Comércio Ltda.

Strategic investment into one of the largest

loader cranes markets at peak years.

Market gradually stabilizing with first positive

indicators. Argos respected loader crane brand

and market #2 in a market expected to grow.

Strategic investment for Hiab with mid-term

growth potential for domestic loader crane

designs and select premium Hiab offering.

Brazil – Argos acquisition strategic growth investment

11Market estimate; Brazilian domestic models* Source: IMF world economic outlook

Image: Hiab Brasil team with first Argos crane produced under Hiab ownership | October 2017

Market fundamentals for China strong with

continuous GDP growth >6% and large scale

investments into next-tier cities. Pan-Asian region

growth strong.

Big potential for more versatile and advanced load

handling equipment.

Hiab leader in premium segments like knuckle boom

cranes and demountables in applications like F&R,

governmental business, and waste. Growth in stiff boom

segment through Sinotruk JV faster than market.

Targeted growth ambition for Hiab in existing segments

and continuous evaluation of M&A opportunities.

China – pursuing growth opportunities for Hiab

Source: IMF world economic outlook

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Hiab is focusing on the services opportunity to become #1

13

Service is key in driving sustainable profitable growth

MEUR LTM*

Service revenue 239

% of total revenue 23%

*) LTM = Last 12 months (Q4 2016 – Q3 2017)

Increased service revenue from

2014 by 21% with annual growth

of 7% CAGR

Maintenance as focused growth

area with revenue increase 2017

YTD Q3 +9% and +12% in US YoY

Continued investment into service

network, systems and tools to drive

profitable growth

Accelerated development of new

services solutions to capture

life-cycle value

Comprehensive global sales & service network

41 Hiab service centers & workshops and 382+ technicians

620+ dealer and service partners and 1,100+ technicians

Growth basis from installed base >150,000 equipment

14

Geographical

split of service

sales

Q3 2017 LTM*

Categorized

split of

service sales

Q3 2017 LTM*

EMEA

49%

AMER

40%

APAC

11%

Installation

Spare Parts

Maintenance

Hiab undisputed #1 in the industry segmentfor services

15

Fundamentals in place

• Parts supply chain in place

• New parts distribution center in

US fully operational

• Spare parts Webshop introduced

and growing (32+ countries)

• ProCare maintenance service

launched

• New on-demand parts launched

MAIN ACHIEVEMENTS NEXT STEPS

Accelerating growth

• Expand the services portfolio

• Service sales competence

development

• Deploy new service offerings

including connected solutions

• Globalize the spare parts

Webshop

• Strengthen route-to-market and

service network

• Implement Service Operating

Model and Service Management

System

FUTURE AMBITION

Future ambition #1

• The undisputed #1 in the

industry segment for services

• Complete service offering with

connectivity - enhancing the

customer lifecycle value

• World-class service operation

and network

Pioneering our industrythrough digitalization

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Hiab - pioneering the load handlingindustry through digitalisation

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Founded New Business Solutions

function to drive digitalisation

across Hiab

• Created Hiab Connected Solutions

portfolio covering:

– Connected & Augmented

Equipment

– Smart Services

– New Business Solutions

• Pilot projects running with key

customers in all major market

areas

• New digital marketplace for Hiab

Parts

MAIN ACHIEVEMENTS NEXT STEPS

All new equipment to be

connected by 2018/19

• Commercial launch of Hiab

Connected Solutions portfolio

market-by-market

• Further development of new

solutions for key segments such

as military, waste management

• Further ramp-up of software &

platform development capabilities

and resources

• Strategic partnerships

(technology, business)

FUTURE AMBITION

Develop Hiab into a complete

solution provider

• Customer first – delivering a

complete customer experience

through digitalisation

– Equipment, services, solutions

• Lead the industry in developing

pioneering solutions in key

segments

• Create value and explore new

business models through software,

platforms and solutions

HiVision™ is the revolutionary and award-winning

vision-based crane control and operation system

First application for timber handling operation

Increasing efficiency, safety, and comfort

Commercially available since Q1 2017

Proven by customers in 9+ countries already

Developing HiVision as platform to enable further

applications and usage scenarios. Key step towards

semi-automated and autonomous operation

Additional value to attract a new generation of

talents.

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Hiab as digital pioneer –the future of crane operation today with HiVision™

HiConnect™ providing business critical insights for

connected Hiab equipment

Show equipment usage and efficiency

Monitor condition and manage uptime

Improve safe and professional operation

Increase business productivity across fleet

Unlocking further value through proactive service,

spare parts, new solutions

Building customer brand loyalty and equipment

sales

Commercial launch Q4 2017 after successful pilots

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Hiab as digital pioneer –unlocking customer value through HiConnect™

Combining our total Hiab offering to unlock potential

Suite of

Connected

Solutions

offerings

Class-leading

load handling

equipment

Best-in-class

service network

and services

offering

20

20

Strong brands and high customer loyalty

Balance through broad geographical and market

presence

Asset light assembly set-up and managed inventory

Active management for productivity gains

Increased services sales supported by

focused investment and connected offering

Hiab with stable business basisfor sustainable profitable growth

21

21

SUPPORTING

Growth momentum across all key markets

and equipment segments

Services growth fuelled by focused

route-to-market investment

Strong demand paired with renewed

portfolio improves product mix and margin

Productivity improvements

Key profit drivers for 2018

HEADWINDS

Currency development mainly EUR/US$

Unfavourable commodity material price

development

Investments in sales and service growth

Buying cycles and competitive pressure in

key accounts

22

22

Well positioned for further profitable growth

Accelerated our growth and

delivered strong business results

Strengthened our equipment and service leadership

positions

Favorable market situation continues – managing

headwinds

Capture further growth opportunities

Capitalize on market fundamentals and mega trends

Grow and expand services, leverage digitalization

Actively pursue developing market opportunities

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APPENDIX – MARKET DATA

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Oxford economics forecasts growth for all markets for 2018

Oxford Construction Output

Source: Oxford construction output (All Output series are measured in Billions, 2010 Prices),

Forecast Sep 2017 compared to Jun 2017

Changes vs last Forecast YoY changes2016 2017 2018 2019 2020 2015 2016 2017 2018 2019 2020

NAM -0.1% -0.1% -0.4% -0.3% -0.5% NAM 3.2% 2.2% 2.4% 3.6% 3.6% 2.8%

SAM -0.1% -1.1% -1.3% -1.1% -1.1% SAM -2.8% -2.5% -0.6% 2.6% 3.0% 3.1%

NE 0.6% -0.1% 0.4% 0.4% 0.3% NE 0.8% -0.5% 2.0% 2.1% 1.5% 1.6%

UK 0.0% 0.2% 0.0% 0.0% 0.0% UK 5.0% 2.7% 1.7% 1.0% 1.6% 2.3%

DACH -0.3% -0.6% -0.1% -0.3% 0.1% DACH -0.9% 1.7% 1.9% 2.5% 1.1% 1.6%

BENELUX 0.1% 0.1% 0.1% 0.3% 0.5% BENELUX 5.8% 5.9% 3.1% 2.0% 1.8% 1.4%

MED 0.2% 1.1% 1.4% 1.3% 1.8% MED -1.1% 0.7% 2.5% 2.4% 2.0% 2.6%

EE 0.9% 1.4% 1.9% 2.1% 1.9% EE 4.0% -6.5% 2.7% 3.3% 2.9% 2.4%

MEA -2.9% -2.7% -2.8% -2.6% -2.6% MEA -1.0% 5.2% 2.7% 3.4% 4.1% 4.1%

APAC 0.3% -0.6% -0.5% -0.6% -0.7% APAC 4.7% 4.8% 3.6% 4.2% 4.1% 4.2%

Total 0.0% -0.4% -0.4% -0.4% -0.4% Total 2.4% 2.6% 2.6% 3.4% 3.3% 3.3%

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IHS predicts global truck volumes to decrease in 2018 driven by development in China, outlook for Hiab key markets upgraded

IHS Truck registration forecast

Source: IHS Truck registration (10/2017)

51%

1%-14%

7% 2%-11%

10%28%

-7% -9%2% 1%

-50%

0%

50%

100%

0

500,000

1,000,000

1,500,000

2,000,000

2,009 2,010 2,011 2,012 2,013 2,014 2,015 2,016 2,017 2,018 2,019 2,020 2,021

Truck registrations, GVW >15t

NAM SAM NE

DACH UK/IR BENELUX

EE MED MEA

Changes vs last Forecast YoY changes (vs. prev. year)2 017 2 018 2 019 2 020 2 021 2 017 2 018 2 019 2 020 2 021

NAM 2.8% 3.6% 2.8% -1.2% -2.0% NAM -3.4% 18.6% 10.5% -4.0% -1.7%

SAM 8.4% 6.1% 1.9% -2.4% 2.1% SAM 11.4% 2.5% 3.8% 4.4% 11.8%

NE 6.5% 5.0% 3.4% 4.0% 1.0% NE 26.2% 4.1% 6.9% 4.8% 2.9%

DACH -0.4% -0.4% -0.8% -1.1% -1.1% DACH 1.1% -4.4% -2.1% -6.5% 4.1%

UK/IR 4.8% -1.5% 0.4% 0.2% -1.0% UK/IR -3.7% -6.3% 0.4% 1.1% 2.5%

BENELUX 4.6% 1.8% 0.5% -0.2% 1.0% BENELUX -7.2% -0.8% -0.4% 1.1% 2.6%

EE 4.2% 4.6% 4.5% 2.0% 1.8% EE 7.7% 5.4% 1.4% 4.3% 2.7%

MED 4.2% 1.3% 0.5% 0.0% -0.4% MED 9.2% -0.3% 0.6% 1.5% 6.3%

MEA -1.4% -2.4% -2.7% -1.4% -2.4% MEA 0.0% 3.6% 1.1% 8.2% 2.1%

APAC 23.1% 23.7% -0.4% 4.3% 3.1% APAC 38.4% -12.4% -15.2% 2.7% 0.1%

Total 17.7% 17.0% 0.4% 2.6% 1.8% Total 27.8% -7.2% -9.0% 1.6% 0.9%

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